#4 Tokenisation, Marketing, not JPEG's
We will talk about how tokens (NFT's) are more than just digital art pieces, but rather a tool for marketing to customers and building a community
Hello again! This week we will be looking at tokenisation, and how it extends past just JPEGs and even digital art in general. It's an important part of Web3 to understand and it was also, hopefully, expand your view of NFT's and how they have the potential to revolutionise how you build communities and market brands in an internet-driven age.
NFT's, branding, and building communities
"the community one builds around NFTs quite literally creates those NFTs’ underlying value. And the more these communities increase engagement and become part of people’s personal identities, the more that value is reinforced." - HBR.org, How NFT's Create Value
In the Web3 (near) future, the value of projects (and brands) will largely be driven by whether they have successfully built a community of users who genuinely care about what's being produced. Today brands live or die by their cultural relevance and with the more traditional advertising campaigns being largely less reliable, it's time to look to innovate and generate new ways to engage customers. The internet has made it possible for both brands and users to both produce and consume volumes of content and therefore, advertisements, which was previously never seen before and it's tougher than ever to cut through the noise.
Consumers are now wanting brands that do more than just solve a need they have, they want them to align with their value systems at some level, and brands want to ensure that their products are marketed in such a way as to make the most of their marketing dollars. NFTs, in combination with Web3 technologies, will enable brands to develop more unique customer experiences.
Increase In Brand Loyalty
Before, customers were tied to the standard methods of supporting brands, limiting it just to the purchase of their goods. However now, you can build a more interactive, community-driven experience for these users, increasing their brand loyalty and drawing your fans into your ecosystem in a totally different way, essentially making them part of your marketing team. A prime example of this is a music artist, now normally a music artist has limited ways to reach potential fans, whether that be through streaming services, their social media presence, or their merchandise. Now these artists can create tokens, which enable fans to have access to their work and can potentially own part of the discography.
This will generate a far more loyal fanbase than the more traditional approaches and also provide a steady income source for the artist, and in some cases it allows them to stay independent instead of having to sign for a label, which again will increase the trust their fans place in them. These fans would also double as a form of marketing, as any Web3 project would be talked about in many customer circles before the market is saturated with larger players trying to gain their attention. But also these customers would now be invested, financially and emotionally, in the artist and their success.
If you want to read more about this topic please read my previous newsletter which is linked below!
Improved Product Development Lifecycle
Owners of tokens for the brand can now be utilised for focus groups and are more likely to offer thorough, thoughtful feedback, as they are likely to feel a sense of ownership and connection with the products. The marketing team will be able to gain greater insights from its most loyal customers at essentially no cost!
The introduction of the tokens, when it comes to the initial product launch, also feature as another purchase incentive for potential customers. They will see that they can have an opportunity to give feedback and thus be more directly involved in whether this product is successful or not.
You can also place NFT-based incentives which link all your products, with customers earning NFT's when they reach a certain amount of brand tokens through their purchases. Again, benefitting both the customer via brand loyalty and the customer through unique rewards.
Stronger Communities
I have already touched on this but it cannot be understated how important communities, and how you build them, will be a pillar of a brands identity in Web3. You will be creating a sub-culture around your brand, with these die-hard fans having group discords and showcasing the product (and the community) at no additional cost to you. You see it today with Bored Ape Yacht Club. This brand is revolutionising what it means to be a brand and how you build the identity around it, it's all over twitter and discord groups, and is a marker of success to come in the Web3 space. At NFT NYC they held actual yacht parties for those with a BAYC NFT, and hosting their first annual "Ape Fest", which was an immersive gallery experience and also included a Halloween party. The tickets themselves were free for BAYC holders! This is how marketing will be done in the future!
Increased User Generated Content
Users will be more likely to post content surrounding the project and can be incentivised further via the ability to earn more of these tokens, whether that be through product feedback or submitting to be used for product marketing materials (written and video testimonials). The brand will now have this stockpile of user-created content which it can use for its social media & marketing channels.
Final Thoughts
So this was a short and sweet newsletter today, but I still hope you'll find some value in it. With companies like Starbucks and McDonalds looking to utilise this space. Starbucks are looking to utilise tokenisation (they already use blockchain for coffee tracking) in their rewards programme and McDonald's just recently sold some NFT's. We are entering into an exciting time! Let's enjoy it.
Please share and give feedback below!